SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 5, 1999
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MGI PROPERTIES
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(Exact name of registrant as specified in its charter)
Massachusetts 1-6833 04-6268740
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
One Winthrop Square, Boston, Massachusetts 02110
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (617) 422-6000
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<PAGE>
Item 5. Other Events.
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On October 5, 1999, MGI Properties (NYSE: MGI) (the "Trust") announced
that the Trust sold two apartment complexes for an aggregate sales price of
$39.8 million, which includes $18.6 million of debt secured by the properties,
which was assumed or repaid by the purchasers. For additional information,
reference is made to the news release which is incorporated herein by reference
and is attached hereto as Exhibit 99.1.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
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(c) Exhibits
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Exhibit No. Exhibit
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99.1 Press Release dated October 5, 1999.
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<PAGE>
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MGI PROPERTIES
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(Registrant)
Dated: October 15, 1999 By:/s/ Phillip C. Vitali
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Name: Phillip C. Vitali
Title: Executive Vice President
and Treasurer
(Principal Financial and
Accounting Officer)
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<PAGE>
EXHIBIT INDEX
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99.1 Press Release dated October 5, 1999.
FOR IMMEDIATE RELEASE
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October 5, 1999
MGI PROPERTIES ("MGI")
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ANNOUNCES ADDITIONAL PROPERTY SALES;
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REPORTS THIRD QUARTER RESULTS
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Property Sales and Liquidation Update
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BOSTON, MASSACHUSETTS . . . . W. Pearce Coues, Chairman of the Board of
Trustees, today announced that MGI Properties (NYSE:MGI) has sold two apartment
complexes for an aggregate sales price of $39.8 million, which includes $18.6
million of debt secured by the properties, which was assumed or repaid by the
purchasers. Mr. Coues stated that the Trust's one remaining apartment complex
and two office buildings in Greenville, South Carolina are under contract and
that he anticipates the sales to be completed later this quarter.
Results of Operations
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MGI also reported 1999 third quarter results. For the quarter ended
August 31, 1999, funds from operations ("FFO"), which reflected the June 22,
1999 and July 1, 1999 sales of 54 properties, were $5,382,000, or $.39 per
share, as compared to the $.61 per share earned in the 1998 third quarter. Also,
on July 30, 1999, MGI made a liquidating distribution of $19 per share. FFO for
the nine months ended August 31, 1999 was $23,712,000, or $1.72 per share, as
compared to $23,711,000, or $1.73 per share, earned in the 1998 nine-month
period.
Net income for the quarter ended August 31, 1999 was $124.3 million, or
$9.02 per share, compared to $5,240,000, or $.38 per share, for the third
quarter one year ago. Net income in the third quarter of 1999 included net gains
of $137.8 million, or $10 per share. Also included in 1999 third quarter net
income were various expenses related to MGI's liquidation that aggregated
approximately $18.7 million. Net income was $138.5 million, or $10.06 per share,
in the current nine-month period, versus $23,145,000, or $1.69 per share, a year
ago. In the first nine months of 1999, MGI recognized net gains of $137.7
million, or $9.99 per share, and various expenses related to property sales and
the liquidation, which aggregated approximately $21.7 million. Included in 1998
year-to-date net income were net gains of $8.4 million, or $.61 per share.
THIS PRESS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE
MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933 AND SECTION 21E OF THE
SECURITIES EXCHANGE ACT OF 1934. THESE FORWARD-LOOKING STATEMENTS ARE DEPENDENT
ON A NUMBER OF FACTORS WHICH COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY
FROM THOSE EXPRESSED OR IMPLIED IN THE FORWARD-LOOKING STATEMENTS. SUCH FACTORS
INCLUDE, AMONG OTHER THINGS, THE RISKS OF FUTURE ACTION OR INACTION BY THE BOARD
OF TRUSTEES WITH RESPECT TO THE PLAN OF LIQUIDATION (AND THE ACTUAL RESULTS
THEREOF), INCLUDING THE POSSIBILITY OF LITIGATION PERTAINING THERETO; THE NET
REALIZABLE VALUE OF AND THE TIMING OF THE SALES OF THE TRUST'S REMAINING
PROPERTIES DURING THE COURSE OF THE LIQUIDATION; THE AMOUNT AND TIMING OF
LIQUIDATING DISTRIBUTIONS; CHANGES IN NATIONAL AND LOCAL ECONOMIC AND FINANCIAL
MARKET CONDITIONS, AS WELL AS THOSE FACTORS SET FORTH IN MGI'S FORM 10-K FOR THE
YEAR ENDED NOVEMBER 30, 1998, INCLUDING THOSE SET FORTH UNDER "FORWARD-LOOKING
STATEMENTS," "OTHER" AND ITEM 1 - "ADOPTION OF LIQUIDATION PLAN," AND IN ITS
MOST RECENTLY FILED FORM 10-Q.
(Continued)
<PAGE>
SELECTED FINANCIAL INFORMATION
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<TABLE>
<CAPTION>
For the Three Months Ended August 31, For the Nine Months Ended August 31,
1999 1998 1999 1998
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<S> <C> <C> <C> <C>
Funds from Operations $ 5,382,000 $ 8,348,000 $ 23,712,000 $ 23,711,000
============= ============= ============= =============
Per Share - Basic $ .39 $ .61 $ 1.72 $ 1.73
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Per Share - Diluted $ .37 $ .59 $ 1.66 $ 1.69
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Rental income $ 8,445,000 $ 18,166,000 $ 45,899,000 $ 51,891,000
Interest income 2,042,000 111,000 2,325,000 458,000
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Total Income 10,487,000 18,277,000 48,224,000 52,349,000
Expenses:
Property operating expenses 2,237,000 4,219,000 10,423,000 12,145,000
Real estate taxes 926,000 2,030,000 5,353,000 6,022,000
Depreciation and amortization 200,000 3,074,000 935,000 8,642,000
Unrealized loss on property held for sale 7,750,000 -- 8,950,000 --
Interest 1,066,000 2,635,000 5,956,000 7,627,000
General and administrative 853,000 999,000 2,706,000 2,713,000
Liquidation plan 10,991,000 430,000 12,774,000 430,000
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Total Expenses 24,023,000 13,387,000 47,097,000 37,579,000
Income before net gains (13,536,000) 4,890,000 1,127,000 14,770,000
Net gains from sale of real estate 137,797,000 350,000 137,654,000 8,375,000
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Income before extraordinary items 124,261,000 5,240,000 138,781,000 23,145,000
Extraordinary item - Prepayment of debt -- -- (286,000) --
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Net Income $ 124,261,000 $ 5,240,000 $ 138,495,000 $ 23,145,000
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Basic Earnings Per Share $ 9.02 $ .38 $ 10.06 $ 1.69
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Diluted Earnings Per Share $ 8.55 $ .37 $ 9.68 $ 1.65
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Average shares outstanding 13,774,221 13,760,024 13,773,163 13,728,003
</TABLE>
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(1) Total income excludes gains or losses.
(Continued)
<PAGE>
MGI PROPERTIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
August 31, 1999
(Unaudited) November 30, 1998
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Assets
<S> <C> <C>
Real estate:
Properties held for sale $ 93,913,000 $ 365,543,000
Cash and cash equivalents 53,170,000 12,265,000
Short-term investments 19,709,000 --
Accounts receivable 722,000 5,040,000
Other assets 4,643,000 11,655,000
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$ 172,157,000 $ 394,503,000
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Liabilities and Shareholders' Equity
Liabilities:
Loans payable $ 34,629,000 $ 130,517,000
Liquidating liabilities 9,780,000 880,000
Other liabilities 3,136,000 6,284,000
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Total liabilities 47,545,000 137,681,000
Shareholders' equity
Common shares -- $1 par value; 17,500,000 shares authorized;
13,774,221 issued (13,764,221 at November 30, 1998) 13,774,000 13,764,000
Additional paid-in capital 208,363,000 208,278,000
Undistributed (distributions in excess of) net income (97,525,000) 34,780,000
Total shareholders' equity ------------- -------------
124,612,000 256,822,000
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$ 172,157,000 $ 394,503,000
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</TABLE>
Portfolio Leasing (at August 31, 1999):
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<TABLE>
<CAPTION>
Total Percentage
Property Type Square Feet Leased
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<S> <C> <C>
Retail 715,200 98.0%
Office 299,700 87.4%
Total Commercial 1,014,900 94.8%
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Apartment Units 959 95.6%
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</TABLE>
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For further information contact:
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Phillip C. Vitali, Executive Vice President and Treasurer (617) 422-6000
